To notify selling capital of a associate of the Company
SET. 21/2551
27 June 2008
Subject: Resolutions of the Directors' Meeting No. 3/2008
Attn : President of the Stock Exchange of Thailand The Stock Exchange of Thailand
Enclosure: Summary of information in connection with disposition of shares in Pacific Marketing and Entertainment Group Co., Ltd. to M Picture Entertainment Plc.
The Directors' Meeting of Major Cineplex Group Public Company Limited (the 'Company'), No.3/2008, held on 27 June 2008 has passed the important resolutions as summarized below;
1. Approved the disposition of shares in Pacific Marketing and Entertainment Group Co., Ltd. ('PM') in which the Company holds 9,699,995 shares representing 97 percent of the total shares of PM) to M Picture Entertainment Plc. ('MPIC'), a associate of the Company (the Company holds shares in MPIC representing 41 percent of the total paid up shares of MPIC), at Baht 39.5044 per share. The consideration for the purchase price will be by way of subscription of newly issued ordinary shares in MPIC (Share Swap). The swap ratio is 9.23 new shares of MPIC: 1 share of PM. The total shares of MPIC, which the Company will receive after the share swap is 89,530,953 shares. For the purpose of calculation, amounts less than one share will be disregarded.
Disposition of shares in PM held by the Company to MPIC is considered a disposition of assets of the Company under the Notification of the Board of Governors of the Stock Exchange of Thailand Re: Rules, Conditions and Procedures for the Acquisition or Disposition of Assets by Listed Companies of 2004 dated 29 October 2004 (the 'Notification'). After calculating the size of the proposed transaction in accordance with the Notification, the size of this transaction represents 5% percent of the consolidated total assets of the Company and its subsidiaries as of 31 March 2008.
Therefore, shareholders' approval is not required.
Details of the disposition of shares are set out in the summary of information enclosed herewith.
2. Approved entering into a sale and purchase agreement of shares in PM with MPIC (the 'Agreement'). The Agreement will be effective, upon the satisfaction of the conditions precedent set out in the Agreement. The Company grants a power of attorney to Mr.Vicha Poolvaraluck to negotiate, prepare, execute and deliver the Agreement and any documents in connection with the Agreement including to do any acts that are necessary or in connection with the Agreement.
Details of the Agreement are set out in the summary of information enclosed herewith.
Please be informed accordingly.
Yours faithfully,
(Mr. Chattaphum Khantiviriya)
Chief Financial OfficerInformation Memorandum Concerning the Disposition of Assets
Major Cineplex Group Public Company Limited1. Transaction Date On 27th June, 2008, Major Cineplex Group Public Company Limited has entered into the Share Sale and Purchase Agreement subject to the completion of all conditions precedent.The transaction is expected to take place in the 4th quarter of 2008.
2. Parties involved and their relationships
Seller
Major Cineplex Group Public Company Limited (the 'Company')Purchaser
M Pictures Entertainment Public Company Limited ('MPIC')3. General Features of Transaction
Transaction
The disposition of 9,699,995 ordinary shares of Pacific Marketing & Entertainment Group Company Limited ('PM') to MPIC which the Company is a major shareholder with 41% interest.Type and Size
5 percent of total value of the consideration compared to consolidated total assets of the Company and its subsidiaries.4. Details of assets disposed Pacific Marketing & Entertainment Group Company Limited is located at 97/11 EGV 6th Floor, Rajdamri Road, Lumpini, Patumwan, Bangkok, 10330. PM's Metropolis Building,main business is the distribution of VCD, CD, DVD, films, Series, TV program, music, and entertainment software including a management of the licensed film rights to be exhibited in theatres, to be sold in forms of VCD and DVD, and to be broadcasted through Cable TV and Free TVs.
As of 31st December 2007, PM has registered and paid-up capital in the amount of Baht 100 million, consisting of 10 million ordinary shares with a par value of Baht 10. Details of the Board of Directors as of 23rd June 2008, consisting of 5 members:
1. Mr. Vicha Poolvaraluck 2. Mr. Thanakorn Puliwekin 3. Mr. Chattaphum Khantiviriya 4. Mr. Patrick John Leone 5. Mr. Chalermpol Heetlampoon Financial position and performance
(Unit: Million Baht)
Financial data Total Revenue EBIT Net Loss Account receivables - net Inventory Film rights Total Assets Interest bearing debt Total Liabilities Paid-up capital Share premium Retained Loss Total Shareholders' Equity 5. Total value of the consideration
The total value of the consideration is Baht 383 million. The Company will be settled by newly issued shares of MPIC at the offering price of Baht 4.28 each.6. Value of asset disposed
As of 31st December 2007, PM's net tangible assets is Baht 100 million.7. Criteria applied to determine the consideration
The criteria used to determine the consideration, which is based on financial statements as of 31st December 2007 of PM, are as follows:A. Price to earnings ratio
B. Price to sales ratio
C. Price to book value ratio
D. Average close price of MPIC for the period of 1 day, 15 days, and 30 days prior to the date of the initial discussions on 5th June 2008PM's book value as of 31st December 2007 is Baht 100 million.
8. Conditions of Precedent
The Company shall agree to sell PM shares only after MPIC obtains shareholders approvalfor capital increase and the issuance of newly ordinary shares to the Company for the settlement of the purchases of PM shares.